JNJCAUTIOUS

Return on Equity (ROE)

26.4%

Updated 368h ago

Sector Performance

78th percentile

JNJ

26.4%

Sector Median

13.8%

Sector Avg

31.4%

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Deep Analysis

With a Return on Equity (ROE) of 26.4%, Johnson & Johnson generates $0.264 of profit for every dollar of shareholders’ equity—a measure of how efficiently the company uses invested capital to produce earnings.

This figure is well above the sector median of 14.4%, placing JNJ in the 77th percentile among its industry peers. Trend data is unavailable: the year-over-year and quarter-over-quarter changes are both marked as N/A, and only a single historical value (26.4%) is provided, offering no basis to assess direction. The combination of a high current ROE with no trend information suggests limited insight into whether performance is improving or deteriorating, which raises uncertainty. This strong profitability level typically signals lower investment risk, but the absence of trend data keeps the risk profile ambiguous. The elevated ROE contradicts the overall CAUTIOUS verdict, as a top-quartile return on equity points to efficient capital use; however, the lack of trend context tempers any outright optimism.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about JNJ?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

Who are JNJ's closest peers by Return on Equity (ROE)?

The closest peers by Return on Equity (ROE) include: MRNA (-36.6%), FICO (-37.3%), XRAY (-37.7%), VRSN (-38.3%), MSCI (-45.3%).

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.